The business was set up in 2002 when it simply imported and sold hardwoods to building contractors. The operation was very low key for the first 3 or 4 years. The owner then moved to SVG to manage and build the business. Investment was made in permanent premises in 2005 and during the next 2 or 3 years milling capability was added together with an expanded lumber shed. In 2009 trade in softwoods (pine) was commenced in addition to the core trade in hardwoods, particularly greenheart, sapele and andiroba. Hardware products related to the treatment, finishing and use of timber were then added to the product range such that at the current date there are 2,500 SKU’s. In 2012 sale of steel commenced and the storage facilities expanded to accommodate the new ranges.
The business is located on a 19,885 sq ft plot approximately half a mile from the centre of Port Elizabeth, Bequia. It currently employs 5 full-time staff.
The location of the business, its current customers and reputation means that this is an ideal time to invest in and expand the business. In addition to the existing business lines, the current owner has identified a number of product areas that could be developed such as sand and cement, plus the possibility of providing more delivery services.
The capital required will be minimal without any extra staff required, thus new revenues would fall straight to profit.
Whilst the existing owner recognises this potential he feels that now is the right moment to retire and allow others to take the business forward. However, the owner will (if required) remain as a consultant to the business for a transitional period to ensure business continuity and customer service is maintained.
Financial Summary (All EC$’000)
•Current Revenues 2,900 (US$ 1,086,000)
•Growth Rate 13% per annum (3year ave)
•Gross Operating Profit 34%(3 year ave)
•EBITDA 17% (current)
•EBITDA 14% (three year average)
•Earnings before tax 11%
Account Customer base 350+ (none more than 6% of total) + cash sales (6%)
•Total Assets 2,457 (US$ 920,000)
•Inventory 1,207 (US$ 452,000)
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